TEPCO books more than $1.5 bn in additional losses
Japan's TEPCO said Wednesday it had booked an extra $1.1 billion loss to compensate victims of the Fukushima crisis, and would set aside another $473 million to bring the crippled plant under control. In May Tokyo Electric Power Co. reported a $15 billion annual net loss for the year ended March, the biggest ever for a non-financial Japanese firm, on costs related to the world's worst nuclear crisis since Chernobyl in 1986. But on Wednesday it said it would book an additional loss of 88 billion yen ($1.1 billion) to cover compensation related to "psychological distress" suffered by tens of thousands of evacuees from areas near the plant, following calculations by an official government commission. It also booked 38 billion yen for extra provisions to bring the situation at the Fukushima facility under control after its cooling systems were knocked out by the March 11 tsunami, triggering reactor meltdowns. TEPCO said the new figures will appear in the earnings results of the current financial year ending March 31 2012. "We will book a special loss of 126 billion yen this fiscal year," a spokeswoman said. "We regard the loss to have happened during the last fiscal year. But that earnings announcement has already been audited." The power company faces huge compensation costs. Tens of thousands of people remain evacuated from homes, farms and businesses in a 20-kilometre (12-mile) zone around the radiation-spewing plant, with evacuation pockets also further afield. Ratings agencies have repeatedly downgraded TEPCO, citing the volatile situation at the Fukushima Daiichi plant and uncertainty surrounding the level of state support for the power company as it faces massive costs. Japan's government last week put forward a bill to ensure that the utility can pay compensation, but analysts say its passage in parliament will be difficult and is likely to partly depend on whether the government can win over those opposed to it by enforcing tough restructuring on TEPCO. The bill calls for the creation of a body to handle claims made against TEPCO and will be funded by public money as well as contributions from power companies, but uncertainty still surrounds key details. The legislation calls for the body to boost TEPCO's capital and extend loans to the utility using funds raised by issuing special bonds. National broadcaster NHK on Wednesday said the government will make arrangements to include special bonds worth 1 trillion yen in the second supplementary budget for the current fiscal year. On Wednesday Japanese media said TEPCO is preparing to ask more than 50 financial institutions for a set of relief measures, including around 2 trillion yen in debt refinancing.
